Internet of Things
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Comcast announced in early April that it would offer Gigabit Pro, 2Gbps symmetrical FTTH services starting with Atlanta in May and then expanding to 18 million households in its footprint by the end of 2015. This announcement raises the bar significantly for the US wireline broadband market, even as it is in the middle of significant changes, with major M&A deals, changes in regulation, and competition around bandwidth generating new opportunities and threats. Comcast's competitors need to reassess their broadband service strategies.
Hardly had the ink dried on Ovum's comment highlighting the rise of consumer gigabit services up to 10Gbps, than Comcast made its own announcement. Comcast's 2Gbps plans for 18 million households, if priced reasonably, would ensure a strong competitive advantage in multiple markets.
Comcast will initially offer Gigabit Pro to 1.5 million customers in Atlanta on the back of its 145,000 miles of existing non-FTTH fiber network. Comcast's offering exceeds the 1Gbps symmetrical offerings from Google Fiber, AT&T, CenturyLink, and Cox in the US. Comcast also has some of the fastest Wi-Fi routers (up to 700Mbps) in its customers' homes, having swapped out millions over the past year, removing a common bottleneck for customers in receiving the benefits of a high-speed connection.
For the rest of its footprint, Comcast will use DOCSIS 3.1, which it is testing, to scale up to gigabit services from 2016. DOCSIS 3.1 is not commercially available yet. In addition, DOCSIS 3.1 may not solve the upstream bandwidth competition facing cable operators. The HFC network was not designed to support symmetrical bandwidth.
We believe that Comcast has begun to deploy 10G symmetrical EPON along with continued deployments of point-to-point Ethernet. Comcast is already delivering up to 10Gbps Ethernet service to 1.5 million businesses. Comcast's focus on business subscribers is not new and its continued focus makes sense. ARPUs for business subscribers are typically higher than those for residential customers, and business services represented 9% of Comcast's 2014 revenues.
Comcast's coverage and take-rate assumptions may be too ambitious. To put it in context, Verizon took more than 6 years to cover 18 million households with its FiOS network. Comcast does have an advantage in having extended fiber to its nodes many years ago and it will only offer service to households within a specified distance to its nodes. Pricing is not yet known and will affect customer take-rates. Ovum will be following Comcast's aggressive thrust into the 2Gbps symmetrical market for residential subscribers.
"FTTx: Google sets the bar for 1Gbps FTTH in the US," TE0009-001378 (January 2015)
"FTTx: AT&T charts pragmatic strategy with both FTTN and FTTH," TE0009-001373 (December 2014)
"Mirror, mirror on the wall, who has the fastest broadband of them all?" TE0009-001405 (March 2015)
"Bright House acquisition signals upside for PON equipment vendors," TE0017-000035 (April 2015)
Kamalini Ganguly, Senior Analyst, Service Provider & Markets
Julie Kunstler, Principal Analyst, Intelligent Networks
Consumer & Entertainment Services
By Adam Thomas 28 Mar 2018
With US pay TV having endured the worst year in its history, thoughts have inevitably turned to the future. The likelihood remains that the immediate future will remain highly uncomfortable for everyone except the scaled multinational digital platforms.
By Evan Kirchheimer 26 Apr 2018
Service provider interest in justifying 5G investment through its potential to open new revenue streams from the enterprise segment is growing ever greater.
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